Parties split over buying overseas carbon credits to meet 2030 climate target

Prime Minister Christopher Luxon has said his government would not pay for overseas carbon credits to help New Zealand meet its climate target. "We certainly aren't sending billions of dollars offshore," he said.

Carbon credits are certificates that count emissions cuts made in another country towards a buyer's own target. Buying them is one way a country can meet a climate pledge when its domestic cuts fall short.

New Zealand's pledge under the Paris Agreement, its nationally determined contribution, is to halve emissions from 2005 levels by 2030. RNZ reports that current projections show the country falling 86 million tonnes of carbon dioxide-equivalent short of that target. Carbon dioxide-equivalent is a standard unit that adds up all greenhouse gases as if they were carbon dioxide.

Treasury analysis released earlier this year estimated the cost of offshore credits to cover that shortfall could be up to $5 billion. Treasury produced the estimate after giving Greens co-leader Chlöe Swarbrick an undertaking to do so.

Former climate minister James Shaw said when the target was set that New Zealand could not meet it through domestic emissions cuts alone, and would need to buy offshore credits. Previous governments planned to meet the target largely by buying overseas credits.

The parties now differ on whether that approach should continue. National's climate spokesperson, Simon Watts, said National remains committed to the Paris Agreement and to meeting climate targets. The party says it is prioritising domestic climate action and has "no current plans to buy offshore credits."

Labour's climate spokesperson, Deborah Russell, said Labour stands by New Zealand's Paris Agreement commitments and plans to prioritise cutting emissions at home.

The Opportunity Party's climate spokesperson, Kayla Kingdon-Bebb, said it is "just not possible" to honour New Zealand's Paris pledge without using offshore credits. The Opportunity and Green parties both say a future government will have to buy overseas carbon credits to meet Paris Agreement promises.

The Paris Agreement was adopted in 2015 with an overall goal of limiting global warming to 1.5°C. The United Nations climate conference, COP31, is scheduled to start in Antalya, Türkiye, days after New Zealand's election.